Newscasts - Europe Today: UK finance minister to announce £20 bln hole in public finances
29/07/2024 11:00
Click the following link to watch video: https://share.newscasts.refinitiv.com/link?entryId=1_5lwzozjg&referenceId=1_5lwzozjg&pageId=Newscasts Source: 'Reuters - Business videos' Description: The new British chancellor Rachel Reeves will today accuse the previous government of leaving a £20 bln shortfall in the public finances, at the start of a week that could see a much-awaited rate cut from the Bank of England - although markets see that on a knife edge. Short Link: https://refini.tv/4cXLCBz Video Transcript: Britain's new finance minister is set to announce a GBP20 billion hole in the public finances. Welcome to Europe Today. I'm Elena Casas. The new British Chancellor Rachel Reeves will today accuse the previous government of committing to billions of Pounds of spending that has not been budgeted for, as she releases a new audit of the public finances. She's expected to pause work on a string of infrastructure projects and pave the way for tax rises in this autumn's budget, which could target capital gains and inheritance tax. Ahead of that, yields on two-year UK gilts were at their lowest since May 2023 this morning, with the chance of the Bank of England's first rate cut since 2020 coming this week, seen on a knife edge. Key policymakers have made no public statements for more than two months due to rules around the election. Futures market show a 56% chance of the cut happening on Thursday, but a number of economists polled by Reuters said the wait could go on. CPI hit the bank's 2% target in May and June but is expected to go back up in the coming months. Well, European markets opened largely higher this morning ahead of rate decisions from both the Bank of England and the Federal Reserve this week. Although markets expect no cut in the US, oil and gas stocks led them up as crude prices rose and a clutch of upbeat corporate results also boosted the mood. Dutch medical devices maker Phillips and Merck both soared after beating estimates. Well on the results front, Heineken lost 6% at the open after missing estimates, even though it raised its full-year profit guidance. The world's second largest brewer reported a 12.5% rise in half-year operating profit and said it now expects to deliver between 4% and 8% for the year 2024. It also shook an EUR874 million right down on its investment in the biggest brewer in China after weak demand there. Reckitt Benckiser shares, meanwhile, have hit their lowest since 2013, after a US jury found formula milk made by Abbott Laboratories caused a baby girl to develop a dangerous bowel disease. Reckitt makes a similar product and hundreds of lawsuits have been filed against it in the US. And Brent crude rose to $81.50 a barrel earlier on fears of a widening conflict in the Middle East following a rocket strike that killed 12 in the Israeli occupied Golan Heights at the weekend, which Israel has blamed on Lebanese armed group Hezbollah. And that's Europe Today